Electric-car battery maker running low on resources

The Associated Press

Published
12:00 am EDT, Tuesday, October 16, 2012

DETROIT -- After struggling for years with weak sales and mounting losses, electric-car battery maker A123 Systems filed for bankruptcy protection Tuesday and struck a deal to sell its automotive assets.

Auto parts maker Johnson Controls will pay $125 million for A123's auto business, which includes two Michigan factories and the lithium-ion battery technology used in the Fisker Karma and new Chevrolet Spark.

A123's demise as an independent business reflects the problems of the electric-car industry. Americans have been slow to buy the vehicles because they're expensive, and many models have limited range and can run out of power on longer trips.

Lackluster sales of EVs and batteries left A123 Systems with huge losses and a plunging market value.

The company's stock price, which traded for more than $20 on the day of its initial public offering in 2009, fell to 6 cents in late-day trading Tuesday.

The bankruptcy filing also spawned more Republican criticism of the Obama administration, which used stimulus money to support alternative energy businesses.